We have a two year-old son whom has only gotten to sled once before in his entire life, and when we heard of the oncoming snowstorm, my wife and I figured it would be a great opportunity to break out the ole’ neon sled and take our kid to Capitol Hill for a few turns.

After all, the hill running down the west side of the Capitol is *the* place to sled in the city. I mean, look at this!

The building! The angle! Everything about it screams “I am hill, you must sled me.”

Yesterday was also January 6th, the day on which, every four years, Congress convenes to certify the results of the Presidential Election. For dozens of election cycles, this day was a generally uneventful one - after all, who in their right mind would have the audacity to question the results of fifty-one* separate federal elections conducted by the states (*and the District of Columbia) after being certified by each states’ governing body?

So in nearly every other year, if a massive snowstorm and January 6th happened to fall on the same day, you would see hundreds of DC residents trot out with their kids to the Capitol, enjoy the idyllic landscape, and have a good time.

Instead, this was the view that we DC residents had of the Capitol yesterday.

As it was for many weeks after January 6th, 2021, the Capitol grounds were surrounded by a 10-foot iron fence, preventing anyone without credentials from entering the area. Which meant that our beloved sledding hill was closed.

I am obviously and intentionally skipping over the reasons why there was a giant perimeter fence established around the Capitol for the day on which the election was certified, but just in case you need me to refresh your memory:

These craven jerkwads took away my kids’ sledding hill. And the person they stormed the Capitol for - Donald John Trump - has inexplicably escaped any form of punishment and will be installed as our next President in less than two weeks.

I want my sledding hill back. I want my country back.

As soon as the writing was on the wall on Tuesday evening, I made the surprisingly easy decision to shut down my Twitter account. It truly was the Rubicon moment that I think many other truly independent thinkers have already crossed on their own over the past year, when they discovered that Elon “New World Order” Musk never intended to make Twitter a free speech platform, but instead enable it to serve as a me speech platform: a bully pulpit for all the grievances the elite tech cabal never had space to share.

Since then, I’ve been getting occasional dispatches from friends as they observe the collective cheers from tech leaders across the political spectrum. There is, of course, the as-expected diplomatic congratulatory messages that seek to smooth over Trump’s infamously fragile ego and presume that enough appeasement will satiate his desire for vengeance. I half-expect this and, honestly, if i were someone who was responsible for the livelihoods of tens of thousands of workers, I would adopt a similar concilatory stance.

But then the other positive reactions (of note, i’m ignoring the sheer volume of downtrodden reactions from very thoughtful tech leaders) fall into two separate camps.

1. You have the obvious sycophants - Elon, David Sacks, and others - that had much to lose in a continued Biden-Harris administration and everything to gain with a Trump election. Rumors swirled that many of these leaders faced imminent lawsuits for behaving egregiously, harming individuals, and fleecing investors, and they needed someone to magically make all those go away. I can also understand why they behaved this way; a cornered animal always finds ways to lash out. Within this group is also the rank hypocrites who, just a few years ago, considered Trump’s actions on January 6th “disqualifying”.

2. Then, there are the tech pundits. These are the “citizen journalists” whom have taken to the public digital square to wax philosophical on the election, presumably from an independent voice. If you know me well enough, you know that my typical target when referring to this group is Mike Solana at Pirate Wires whom - while being nauseatingly smug about his points of view and equally coy about his non-Founders Fund financial ties to Peter Thiel - is a really, really good writer. He’s essentially the Ohio State of citizen journalists.

Let’s dive into that second group a bit more.

Much of what these pundits are sharing - including tech commes “whisperer” Lulu Cheng-Meservey, “American Dynamism” investor Katherine Boyle, and others - is the idea that this election is a notable and clear victory for independent journalism (labeling it “the podcast election”) and a resounding defeat for their favorite “wokism” punching bag. The noisy pundit class on traditional media is running with similar takes, something that Desi Lydic so deftly pointed out this week on The Daily Show. In many ways, these citjournos are falling for the same trap - blaming Democrats for crime, taxes, immigration, regulation, trying to label an actual insurrectionist as an insurrectionist….you know, those sorts of things.

In the midst of these grievances, though - Solana may be the only one who kinda gets it right: people weren’t voting for Trump, per se. They just hated Democrats. Why I say this is kinda right is because a) Trump didn’t really gain any support from his 2020 election and b) the Harris ticket lost over 10 million votes from their 2020 turnout. So in the midst of a victory lap for Trump, what they really should be thanking is the egregious own-goal that Democrats scored.

But it’s also partially wrong. Given the massive shifts in voter sentiment from 2020, we would have also expected resounding wins up and down the ticket for Republicans. Instead, this is what we saw:

• In four states which Trump won - Nevada, Arizona, Wisconsin, and Michigan - Democrats won Senate seats, pacing far ahead of the Harris-Walz ticket. And while Democrats lost the senate overall, this felt more like a foregone conclusion.

• In nearly every other congressional race, Democratic candidates outpaced Harris-Walz voters - including noted Democratic Socialist Alexandria Ocasio-Cortez, who won her re-election campaign by +38 points and was only one point off her win in 2022.

• In a personally satisfying note - my longtime friend Nicole Uhre-Balk will be one of only eight Democrats sitting in the South Dakota State House after ousting her Republican challengers.

• I’ll also note that, here in DC, a foolhardy attempt to pin an uptick in crime on Ward 6 Councilmember Charles Allen and attempt to recall him was so panned, that it didn’t even make it to the ballot. San Francisco could learn a lesson here.

This doesn’t sound like a wholesale rejection of Democratic ideals and norms, and so it’s important to bring it back to what I consider perhaps the three more apparent factors that led to this outcome.

1. The top-line Democratic ticket did a shit job marketing itself over the past four years, and I think it’s reasonable to place the blame on Joe Biden and his inner circle. Somehow, they allowed truth-benders to steer the Inflation Reduction Act, the strongest market bull run in decades, and massive necessary investments in infrastucture to be co-opted by a deeply unserious crowd of critics - many of whom were in their own party - that would rather focus on the no good, very bad things Democrats were doing when it came to immigration and transgenderism. Biden and his team had a really, really shitty PR infrastructure, hoping beyond hope that every angle of the media would pick up on it. On this point, absolutely - they missed out on the citizen journalism aspect of pushing this forward in a grossly damaging way. Harris, unfortunately, wasn’t afforded much time to dig out of the multi-year hole that Biden had dug for her, and (fortunately) down-ballot races were rendered somewhat immune, which I chalk up more to general sentiment on where ire is directed.

2. We also need to have a serious reckoning around what “prosperity” truly looks like, and what the avatar should be for an ostensibly suffering part of our population. For much of our parents’ generation, hard work was rewarded with security and a better life for their families. It truly is the backbone of the American Dream. That avatar has been co-opted by extraordinaly wealthy people, including Donald Trump, which now suggests that our young people and immigrants - two groups that wildly swung to Trump in this election - can have a successful life if they 1. make millions of dollars and, when that’s not possible, 2. craft a bogeyman to direct all your blame at. There is a combination of anger and sadness when I see that women are now being acosted with the “Your Body, My Choice” meme, crafted by one of Trump’s associates, in the wake of his victory…because the people these young men have looked up to have not been given a replacement role model. We must not ignore this as an important factor in how this election turned out.

3. But we also need to look at the other obvious factor: people who know better straight-up memoryholed everything we know about Donald Trump. When I examine the apparently honest takes from citizen journalists, I notice a particular glossing over of a few things, like….

• when Trump incited an insurrection against the government

• mismanaged a pandemic that killed nearly half a million Americans

• separated children from their families and lost those children in the bureaucracy

• tear-gassed peaceful protesters on Lafayette Square so he could hold a photo op holding a Bible in front of a church

• got impeached

• got impeached again

• had the worst jobs record of any president in modern history

• pressured Ukraine to dig dirt on Joe Biden

• fired the FBI director for investigating his ties to Russia

• then bragged about firing the FBI director on TV

• took Vladimir Putin’s word over the US intelligence community

• diverted military funding to build his wall

• caused the longest government shutdown in US history

• banned transgender people from serving in the military

• ejected reporters from the White House briefing room who asked tough questions

• vetoed the defense funding bill because it renamed military bases named for Confederate soldiers

• refused to release his tax returns

• increased the national debt by nearly $8 trillion

• had three of the highest annual trade deficits in U.S. history

• called veterans and soldiers who died in combat “losers and suckers”

• coddled the leader of Saudi Arabia after he ordered the execution and dismembering of a US-based journalist

• refused to concede the 2020 election

• hired his unqualified daughter and son-in-law to work in the White House

• called neo-Nazis “very fine people,”

• suggested that people should inject bleach into their bodies to fight COVID

• abandoned the Kurds to Turkey

• pushed through massive tax cuts for the wealthiest but balked at helping working Americans

• withdrew the US from the Paris climate accords

• withdrew the US from the Iranian nuclear deal

• withdrew the US from the Trans Pacific Partnership which was designed to block China’s advances

• insulted his own Cabinet members on Twitter

• pushed the leader of Montenegro out of the way during a photo op

• failed to reiterate US commitment to defending NATO allies

• called Haiti and African nations “shithole” countries

• claimed that he single handedly brought back the phrase “Merry Christmas” even though it hadn’t gone anywhere

• believed he should be awarded the Nobel Peace Prize

• berated and belittled his hand-picked Attorney General when he recused himself from the Russia probe

• suggested the US should buy Greenland

• colluded with Mitch McConnell to push through federal judges and two Supreme Court justices after supporting efforts to prevent his predecessor from appointing judges

• repeatedly called the media “enemies of the people,”

• claimed that if we tested fewer people for COVID we’d have fewer cases

• violated the emoluments clause

• called his exceedingly faithful vice president a “p---y” for following the Constitution

• nearly got us into a war with Iran after threatening them by tweet

• nominated a corrupt head of the EPA

• nominated a corrupt head of HHS

• nominated a corrupt head of the Interior Department

• nominated a corrupt head of the USDA

• refused to allow the presidential transition to begin

• insulted war hero John McCain – even after his death

• spent an obscene amount of time playing golf after criticizing Barack Obama for playing (far less) golf while president

• falsely claimed that he won the 2016 popular vote

• called the Muslim mayor of London a “stone cold loser,”

• falsely claimed that he turned down being Time’s Man of the Year

• mocked wearing face masks to guard against transmitting COVID

• locked Congress out of its constitutional duty to confirm Cabinet officials by hiring acting ones

• used a racist dog whistle by calling COVID the “China virus”

• hired and associated with numerous shady figures that were eventually convicted of federal offenses including his campaign manager and national security adviser

• then pardoned them

• got into a telephone fight with the leader of Australia(!)

• forced his press secretary to claim without merit that his was the largest inauguration crowd in history

• charged the Secret Service jacked-up rates at his properties

• claimed that COVID would “magically” disappear

• called a U.S. Senator “Pocahontas”

• used his Twitter account to blast Nordstrom when it stopped selling Ivanka’s merchandise

• opened up millions of pristine federal lands to development and drilling

• got into a losing tariff war with China that forced US taxpayers to bail out farmers

• claimed that his losing tariff war was a win for the US

• ignored or didn’t even take part in daily intelligence briefings

• blew off honoring American war dead in France because it was raining

• threatened to go after social media companies in clear violation of the Constitution

• botched the response to Hurricane Maria in Puerto Rico

• and threw paper towels at Puerto Ricans when he finally visited them

• pressured the governor and secretary of state of Georgia to “find” him votes

• allowed White House staff to use personal email accounts for official businesses after blasting Hillary Clinton for doing the same thing

• rolled back regulations that protected the public from mercury and asbestos

• rolled back regulations that stopped coal companies from dumping waste into rivers

• refused to attend his successors’ inauguration

• threatened judges who didn’t do what he wanted

• attacked Dr. Anthony Fauci

• promised that Mexico would pay for the wall (it didn’t)

• allowed political hacks to overrule government scientists on major reports on climate change and other issues

• called an African-American Congresswoman “low IQ,”

• threatened to withhold federal aid from states and cities with Democratic leaders

• …and continues to claim that he never lost the 2020 election.

Let’s be clear here: when you literally claim to be a journalist and spend more of your time focusing on that one moment where Kamala Harris said in 2019 she would support gender reassigment surgery for undocumented immigrants in custody, while ignoring that policy was implemented in 2016 and NOT REVERSED BY THE TRUMP ADMINISTRATION, you should be deadass honest and say that you intentionally want to put the thumb on the scale. You want to mold and shape your avatar of these two sides into how you feel about them, and - in the case of Solana - you can almost sense the gritting of teeth behind the smirk as he jots down words about the badness of wokism and how Democrats - and society writ large - should be punished for ever constructing such an egregious idea of….letting people live their lives and holding fast against the businesses and institutions seeking to make their lives a little harder.

Solana attempts to square this circle by stating the following:

“In the end, Americans weren’t nearly so worried about the man Democrats dragged to court as they were the Democratic Party’s wild, historic abuse of power.”

And this is the coda. Never mind that these abuses of power were in no way egregious violations of the Constitution that resulted in impeachment. Never mind that it was a former Republican in Robert Mueller who instituted the initial investigations into Trump’s activity. And never mind that both Republicans and Democrats voted to convict Trump on the charges laid before him. It is really just convenient to place transgender rights (by misgendering Imane Khalif for some ghastly reason) on the same plane as an attempt to subvert the Constitution, because that is how you square the pretzel-twisting going on here.

So, no. I refuse to say that this election was a referendum on small-d democratic ideals, the ideals that ushered in Social Security (which people like), Medicare (which people also like), and the totally non-partisan idea of putting fluoride in drinking water (which your dentist likes). This was an election in which the so-called decentralized approach to information, in perhaps its biggest test, failed miserably to inform the voting population of what really is going on.

And that’s something these tech leaders will never cop up to, in the same way that they will never admit when their technologies create egregious harm or division or pain. If we expect honesty and contrition from them, we will be waiting a very, very long time.

*this includes Keith Rabois, even though he claims to be “not a Silicon Valley resident” despite owning a multimillion-dollar home there, spending a few days per month there…walks/talks like a duck, etc.

Anyway, as I pushed my toddler in his stroller, brainstorming on the examples I wanted to raise in this discussion, someone sent me a text:

…and yep, there he is:

All said, it certainly made it a lot easier for me to tie everything together.

About a year ago, I wrote about the silent acceptance of Ron DeSantis’ run for the Presidency, a candidate whom I’ve considered even more dangerous than Trump. Within, I wrote:

“Sacks, for what it’s worth, is a longtime supporter of little-c conservative efforts, so his involvement in the above campaigns, and hosting the DeSantis announcement, were of little surprise. My befuddlement is with Tan and others, whom have spent the past several years placing San Francisco’s dubiously-progressive label on a pedestal and shooting paintballs at it all while being self-proclaimed “moderate Democrats”.

It should be of no surprise that the ringleader in all of this public shift toward Trump is David Sacks, whom never attempts to hide his flip-flopping nature and mea culpas. Accordingly, you’ll notice in the All-In crew’s debrief that Jason Calacanis makes mention of the fact that they didn’t get a chance to cover a few topics that he had wished, instead deferring (likely to Sacks’ preference) to topics around economy, national security, and (strangely) a long, meandering discussion around China, Dr. Fauci, and our COVID response.

One of those topics? The fact that Donald Trump is under Federal indictment for engaging in election interference while President.

For me, the amount of ignorance around this fact amongst tech leaders is absolutely baffling and infuriating. At some point, the collective Silicon Valley crowd determined that an economy with fewer guardrails (which Trump will likely implement) is worth the consequence of political persecution of anti-conservatives, erosion of individual and familial rights, dwindling of climate-protecting laws, and whatever type of fresh hell that Project 2025 throws at us.

However, it only takes a glimpse back into the late 19th century to get a better sense of the playbook they’re operating from: Robber barons (of whom the esteemed Leland Stanford was a member) did a fantastic job of building an inception-style worldview which broadly decried regulatory policy and the obfuscation of progress in order to have political leaders do their bidding.

It’s pretty apparent, to anyone observing, that the tech leaders of today are not backing Trump due to some kind of moral framework. They’re backing Trump because they don’t have a moral framework, as far as we can tell. Their framework centers squarely on the idea that the human spirit of ingenuity is only worthwhile if they profit handsomely from it; as far as they can tell, Trump is the golden goose who will bring that to their doorstep.

Note: I originally posted a two-part series on Medium in January 2021. With some recent high-profile foibles by a few VCs in the space, I thought I’d review it and see whether it’s really gotten any better.

My sense is that it has not - and in fact, we are seeing some investors and tech leaders double down on some of the more troubling aspects that this piece highlights. As we approach another consequential election - both at the federal and state/local levels - the importance of aiming a critical eye at the discourse is all the more important.

I’m reposting it with only minimal updates. Some of the statistics have gotten even worse, as has some of the rhetoric.

Finally: I refuse to call Twitter by its new name. Sorry for the pedants in the audience. :)

PROLOGUE: I wavered on writing this.

After all — I’m a venture capitalist, so how could I authentically strike the balance between calling out the clear and damaging issues in our industry and its icons, while not sounding sanctimonious and presuming that I’ve got this all figured out?

I was still on the fence on writing about this until this past week, when I saw many tech leaders’ responses to the violent insurrection that occured less than a mile from my home, where they concluded the real villains were the platforms that tried to snuff out violent rhetoric, not the rhetoric itself. This terrifying response reminded me that I had a lot to say, and I might as well say it.

If anything, this is my feeble attempt at doing three things all at once: criticizing the areas of venture capital that need some light shone on them; expressing my own observations on where I’ve seen some things attempted to make change in the industry internally; and to put some context on what you, reader, can do as an observer, engaged/injured party of, or participant in this industry.

It’s messy, because my thoughts on the topic are emotionally charged. It is chock full of opinions and anecdotes — thus, if you are looking for some form of rationalism that takes a cold, emotionless look at things, this is not it. And I think that’s okay.

So, here we go, and remember: you’re only a click away from yelling at me on Twitter if you have some thoughts.

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The men who the CEO seemed to admire were the same men whom all the other men in the ecosystem admired: entrepreneurs, investors, one another. Chief among them was a founder of the seed accelerator…I didn’t doubt his business insight, but I didn’t know why he seemed to believe it qualified him as an expert on anything — everything — else.

— Anna Wiener, Uncanny Valley

We’re in a weird time in the tech industry — or, at least, it feels weird in that it feels even more detached from reality than tech usually does. At the time of this writing, the statistics from 2020 are grim: over 350,000 Americans dead, and over 19 million more of them unemployed, due to the combination of a horrifying pandemic and a nearly-equally-horrifying response to it by officials both unelected and not.

In the midst of this glum news, there is a particular commune that has seemingly walked through the fire unscathed, if not actually galvanized by its heat: it was a bellewether year for the tech industry, with several long-anticipated IPOs coming to fruition, large-cap stocks growing in value, and new unicorns minted. Each of these success stories comes with an extraordinary jump in the net worth of a concentrated class of individuals. Today, one share of Amazon stock is worth more than what most Americans on unemployment insurance get in a month. San Francisco rent prices are declining, yet home values continue to skyrocket.

I fully admit that am part of that concentrated class — maybe not in the nucleus, but definitely in nearby orbit to it. I watched as those a little bit closer to the sun — those who perhaps haven’t been burned by tech as much as me, or those who are more deeply and anxiously attached to it — followed a similar pattern this year with their online presence. (I should pause here and state that, while I know that Twitter is not a perfect representation of reality, it’s also not pure performance fiction. Out of the heart, the mouth speaks.)

These tech leaders’ year of publicly-facing discourse mostly included blips of how to hack society and invest wisely in the throes of a lockdown, then followed up with a two- or three-week barrage of posts suggesting that Black Lives Matter (or mattered, I suppose, since many black-squared posts and promises to “do better” were bookended by photos of Marin sunsets or excursions to Tahoe), then some generally subdued observations of the upcoming election with the year bookended by a reflection on how many hustle points were earned in 2020. Throw in a puff piece or two about the “next frontier” of tech conducted from the living room of a multimillion-dollar home while ignoring an actual coup or explaining it away, and we’re just roaring into 2021 on the back of a gilded chariot.

This wasn’t happening in small business communities, nor was it happening amongst those working on reproductive rights initiatives, and it definitely wasn’t happening in the healthcare industry. Most of the friends and acquaintances I know in these industries are burned out and see this coming year with trepidation: will there be right-wing violence in our streets and shockingly slow distributions of the vaccine combined with refusal to take it, leading to even more deaths? We know the answer to both is closer to “yes”, but it seems like a segment of our society is either blissfully ignorant or — at worse — cheer on the chaos.

Whatever was actually happening seemed to exclusively occur in two solar systems: one was in the orbit of President Trump and his cronies; and the other was in the venture-backed tech industry. We gave both inordinate amounts of attention, and we expressed universal disgust toward neither.

A few weeks ago, a rising college senior reached out to me on Twitter to set up some time to connect. They’re graduating soon, they said, and they wanted to get some tips on how to break into venture capital.

As they outlined a few questions, I responded with the first thing that came to mind: remembering what venture capital is at its core. Ultimately, it’s a more free-range, California-cool inspired version of investment banking, in which the end goal is to make wealthy people even more wealthy. VCs are essentially more nuanced mutual fund managers for their Limited Partners, except unlike Vanguard, the risk quotient is a lot higher and you spend a lot more time engaging with the company leadership within your portfolio. But yeah, at the end of the day, it’s about managing other people’s money with the hope you’ll be adept at diversifying their wealth.

They paused on the Zoom line, as if the screen froze, and then responded slowly: “you’re the first VC I’ve ever spoken to that has said that.”

I’ve scoured the internet far and wide, but for the life of me, I’ve not found a corner of society that dotes so heavily upon a Fidelity Investments fund manager, despite the fact that many of them have probably made some investors very, very, verrrrrry rich, like they do upon an investor that made a good early-stage play on a decacorn like Airbnb. (If you work for Fidelity, don’t worry, I see you and appreciate you. :))

I’ve witnessed this myself. Since joining the venture capital world, the amount of engagement I have online with strangers, the LinkedIn views, the requests for discussion, have grown exponentially in the past year and have far outpaced my knowledge acquired in the same timeframe. All that really changed was that, from the lens of an aspiring entrepreneur, I ostensibly have more power over their own livelihood.

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Here’s the reality, though: no matter how off the grid you wish to be, you, tech worker or founder, have dozens of people in power with ownership over your livelihood. The fund manager for your IRA, the mayor of your city, your congressperson, the person that oversees public transit in your city, the head of the EPA, Homeland Security, the TSA Agent, the police chief. Every single one of these people has some form of power over not just the success or failure of your company, but your daily living and breathing. And every day, there are countless people mobilizing with their words, their actions, their donations, and their votes to make it plainly clear that decisions those powerful people make will not go unnoticed. In many ways, these people listen to their constituents and change their ways, out of moral obligation, duty to their constituents, or fear of power loss.

Yet the industry has given carte blanche to venture capitalists and gleefully invites them into our homes and screen to provide insight — and, worse yet, manipulate an entire sub-economy — with minimal critique. The industry has given them (er, us) free passes despite a rift of sexual harassment allegations (or staying mum when those allegations surface at one of their companies). The industry remains silent when we take aim at civic leaders, yet choose not to vote — or even worse, just move away because cities refuse to serve us, the highest-bracket taxpayer. The industry lauds our committed claims to diversity and equity in the industry, yet believe us when we say years later it’s just a “pipeline problem” and continue to fund founders that look like us, attended the same schools we did, and laud the same business leaders we do. We intrude into your lives with claims of higher knowledge of real estate, politics, journalism, constitutional law, medicine, and education despite having only cursory knowledge of each — and, in some cases, chastizing anyone that has the audacity to research the history and complexities of each topic and joining civil society to improve them instead of just programming something to disrupt them. We tell society that the only college degree worth getting is a Computer Science degree.

We’ve occupied an extraordinary and disproportionate amount of space in the innovation conversation, and it’s not just Twitter that has noticed: Josh Lerner and Ramana Nanda note that, beyond our public personas and behavior, there are some hugely systemic concerns with the overall effects of our work:

Three issues are particularly concerning to us: 1) the very narrow band of technological innovations that fit the requirements of institutional venture capital investors; 2) the relatively small number of venture capital investors who hold, and shape the direction of, a substantial fraction of capital that is deployed into financing radical technological change; and 3) the relaxation in recent years of the intense emphasis on corporate governance by venture capital firms. We believe these phenomena, rather than being short-run anomalies associated with the ebullient market of recent years, may have ongoing and detrimental effects on the rate and direction of innovation in the broader economy.

I read the above with some buzzing of hypocrisy in my head: I am complicit in many of the above, if not an active participant, without consequence. And the power that comes with attention — well, it enables me to sympathize just a little bit with the guys in their $29 million Miami homes. They’re hooked to the IV drip of power, unable to wean off of it, and definitely hostile to anyone that charges the throne.

Now, I like my job as a VC. I feel like I’m pretty decent at it. But there’s nothing I’ve done outside of some personal research and academic work (MPPs of the world, unite!) that makes me a particular sage on a variety of topics. If you trust me more than Chris Krebs on election security, Nikole Hannah-Jones on race relations, Sherrilyn Ifill on civil rights measures, or Amarnath Amarasingam on extremists using social media, then something is wrong with both the ways we glean information and my conceit in believing I’m smarter and more capable than them to discuss the topic.

Then again, if the internet was good for anything, wasn’t it this? Transparency in action; access to the minds of the industry elite….How else to know which members of the venture class defended megalomaniac founders as entrepreneurs who couldn’t scale, or mistook criticism as harassment and perceived themselves as victims of digital mobs? How else to understand the deliberately amplified identidies, ideologies, and investment strategies of the people transforming society — the people I was helping make rich?

— Also Anna Wiener, also Silicon Valley (P.S. you really should read this book)

If VCs are heroes, then we’re probably more in the veneer of a Hancock-style rather than a Fantastic Four. If you’re not familiar with the film, here’s a brief summary:

John Hancock is an alcoholic who possesses superpowers, including flight, invulnerability, and superhuman strength. While performing superhero-like acts in Los Angeles, he is often ridiculed and hated by the public for his drunken and careless acts, and becomes enraged when referred to as an “asshole.”

Is his presence a net good? mmmm…sort of. The film does a good job of creating a dilemma in the viewer’s mind on this. Either way, what we do know is that there is a clear difference between how Hancock perceives himself, and how others perceive him. He also shows very little desire to change that balance; why should he, after all? (Yes, I know he finally changes his ways in the end, which deserves some credit.)

So, shall we all revolt against the investor class, ignore our missives, and cast our iOS devices into the ocean in response to a longstanding pattern of VCs behaving like this? Yes. No. Maybe?

Eh, probably no. For all that we need to reckon with, starting all over and building a completely new tech ecosystem would probably result in the same outcome — an eventual rebuilding of a class structure with very few ultra-wealthy people at the top. This is an unfortunate blueprint of society at large, and it dismisses out of hand that technology can be an enabler of some good. It just needs some fundamental changes.

But it is a new year, and in the spirit of resolutions, let me offer up a few gentle nudges on how we can collectively make this industry a little more humane and equitable:

1. Organize. The idea of unionizing in tech has been dismissed by many: after all, what do already well-paid people actually need to organize around? But what if you could leverage your power to ensure gig workers are paid a fair wage, or janitorial staff aren’t forced to live in RVs or make four-hour commutes to work each day, or to protect power-thirsty leaders from wielding their disproportionate power against marginalized colleagues? If you believe in fair housing, organize around that or donate to causes that do. But don’t just pack up and leave — whether the industry or your city — do something with that pent up energy and extra money in the bank. I believe the reason why we’ve not seen sweeping changes in thoughtful capitalism in this industry is because we’re at the very tip of activism. Let’s stay the course. My specific commitment is to focus all of my earnings from a few liquidity events to organizations supporting Black-and minority-owned enterprises, whether as an investor or a donor. (Note: as I was writing this piece, Alphabet workers heeded the call. More of this is needed.)

2. Filter. There is no rule stating that you have to follow the tech gentry on Twitter. I have 364,000 accounts on Twitter blocked or muted (and have been blocked by a non-trivial number as well!); nearly all are bots or far-right polemists, but a non-trivial number are some of Silicon Valley’s (and also Miami and Los Angeles’) most prominent investors and self-appointed “thought leaders” whose rhetoric occasionally borders on violent. I don’t feel like I’ve missed out on discourse across a spectrum despite this heavy-handed approach: on the contrary, I’ve discovered that engaging with people who are addicted to power, prestige, and attention will provide me with no added benefit, will probably just make me feel worse about myself, and there are dozens of books on my shelf — or even a call with my Trump-supporting, Tech-averse parents — that offer more sage advice with a kinder veneer than they ever will. There are many tech leaders that believe the best way to prove a point is to do it through brute force humilitation of an opposing viewpoint and the person who carries it, and this humiliation is often disproportionately lobbed at people of color — that is toxic, unproductive, and maddening. While we should admit that these tech leaders may have some power over you, it’s your choice on how much more you want to give them. In response to my own acknowledgement of this reality, I’ve started my own list of Twitter investors, nearly all located outside of Silicon Valley, with a more balanced, global, and empathetic view of the world. I believe the discourse in the circles I’ve found is more humane and inclusive, if not a little scary in its truth-speaking to privilege and power, and I believe it’s because everyone seems to come from the position of willing to learn before proclaiming any semblance of expertise. We should not just hone in on a little peninsula in California, or better yet, just the countries that are high on the Human Development Index.

3. Vet. I’ll keep this simple: if you’re seeking capital as a founder, yet find yourself morally opposed to the publicly-facing persona of a venture capitalist, include this as a factor in your decisions around whether to partner with them. You personally have agency in this scenario, and I would be saddened to find you, founder, in a situation where you discover that someone on your cap table behaves in a way that jeopardizes your position in the public realm or muddles your trust of them. It’s entirely possible you may not want to work with me on any deals based on your strong and fervent disagreement with this piece I’m writing — and I accept that as part of the risk. I just want you to feel unrestrained in your moral choices.

4. Explore. This may be an extension of (1) and (2), but in this journey, you may simply discover that tech is not the place where you will truly thrive as a person. As an example, my wife was tech adjacent for several years, returned to graduate school, and is now a clinical grief and trauma psychotherapist. Her life is infinitely possible — her problem-solving skills will apply to those facing trauma, not a buggy line of code, and she cares 0.0 percent that a technologist would find that work supposedly inefficient. I will, again, highly recommend you read Anna Wiener’s own journeythrough the industry.

Now, the unfortunate caveat here is that not everyone has the time, financial security, and even privilege to do any of the above. And for you just starting out in the Wild West of technology, I know that you’re really eager to gobble up any bit of information you can or get in front of the right power-broker to get your first investor/mentor. As someone that didn’t really get here until sixteen years into my own career, I can tell you that getting somewhere faster only gets you closer to getting more entrenched in something sooner — for better or worse. For me, I’m personally glad that my half decade in Silicon Valley has been bookended in cities (and industries) that many of the tech elite consider to be subpar loci of innovation.

Take your time and continuously ask who and what in this industry motivates and inspires you, makes you feel more motivated to take things on, or at the minimum, doesn’t punch down when you ask the hard questions. And speaking as a person in inherited power and unearned privilege, I ask you to hold me to these truths. I promise to do my best to listen and learn, no matter whether you approach with flowers or a sword.

Anyhoo.

As I reflected on how I wanted to expand Skeptocapital, I realized that its mission should not be controlled by my limitations - writing desires, time to write, etc. - so I wanted to start off the year with an open invitation.

Some of you may have articles, poetry, or something else that fits within the themes of Skeptocapital, and you’d prefer an existing platform to share it on. So, I’m offering this one up to you as a space to do so. Moreover, I want to give you the space to write it anonymously if you so desire.

I’ve had lots of people send me texts, emails, and DMs sharing views that, in the current discourse, would get them ostracized (at best) or fired (at worst) for expressing them; the blunt-force-capital wing of the tech industry has shown recent abhorrence for particular ideas. I want this platform to be the place where those views can be freely expressed, shared, and brought into the mainstream.

If you’re interested in contributing, drop me a note at skeptocapital@gmail.com (or on Twitter — DMs are open) sharing a few things:

• what you want to write about (in 2-3 sentences)

• when you want to share it (deadlines!)

• and who you want to read it/what goals you have in sharing your perspectives

I look forward to hearing from you.

Last night, Ron DeSantis opened the lid on the worst-kept secret in politics and announced his candidacy for the 2024 Republican nomination for President — of course, not before ensuring he signed into law protecting his own ability to remain in office while campaigning. What was surprising, however, was the way he did it, as well as the response it generated.

It was surprising in a few ways, actually.

Firstly, it was announced the day prior that it would happen on Twitter Spaces, an attempt to create a claimed “rare and unscripted conversation” that tried to paint a historic tone on this event despite many candidates doing similar radio-and-television-based town halls in the past. This was allegedly an attempt to raise a middle finger wrapped in a Milton Friedman book to legacy media outlets.

What was also surprising is how much attention the abject technological own-goal the Space got as opposed to a deeper and authentic look into DeSantis’ generally horrifying political stances. There is a schadenfreude inherent in the Extremely Online crowd to see Twitter fail - which the broader media latched onto immediately after the event - yet it left those who want DeSantis’ lack of presidential fitness on a policy level to be further exposed a bit disappointed (including, admittedly, me).

But where I found myself most surprised - or, perhaps, exasperated, was the way the venture community responded.

Since 2020, tech leaders - investors, founders, and others - have vocalized their positions on various civic topics in more demonstrative ways. Perhaps the most targeted upswing in discourse has centered around San Francisco’s topsy-turvy journey through the pandemic. I don’t need to go on about the myriad “moderate” efforts that prominent investors like David Sacks, Garry Tan, and others have advocated for over the past several years — they’ve been well-documented.

Sacks, for what it’s worth, is a longtime supporter of little-c conservative efforts, so his involvement in the above campaigns, and hosting the DeSantis announcement, were of little surprise. My befuddlement is with Tan and others, whom have spent the past several years placing San Francisco’s dubiously-progressive label on a pedestal and shooting paintballs at it all while being self-proclaimed “moderate Democrats”.

It would seem, then, that if Tan and others still consider themselves slightly left-of-center, then they presumably would be quick to denounce a DeSantis campaign that expands upon his Florida culture wars, authoritarian characteristics, and general misalignment with all things liberal. Instead, last evening’s Twitter feeds of Tan, GrowSF founder Sachin Agarwal, RootVC Partner and Dean Preston reply guy Kane Hsieh, and many others rolled through another repetivie airing of grievances against San Francisco’s progressive front, the crime progressives have allegedly enabled, and the mayhem therein. One of two things are happening here: either they consider a pivot to publicly announcing their opposition to a DeSantis presidency to be off-brand or distracting, or they are choosing to endorse his campaign through silence and complicity.

I’ve formed an opinion on this, and it’s based a little bit on personal experience: it’s probably both, but more of the latter. I have proposed a slightly progressive take countering their fearmongering, and it’s been met with shunning and blocks on twitter. One owner of an Angel syndicate even removed me from his group after I pointed out that, despite being connected on LinkedIn and part of his syndicate, he had me blocked on Twitter; when I asked why, he simply said “I’ve had problems with people that think like you”. And there is not much of an indication that any of these tech leaders plan to lift much of a finger to advocate for a strong and truly united front to defeat either candidate the increasingly right-moving Republican Party selects.

My friend at Laconia, Geri Kirilova, has written extensively on the risks of enmeshment in the venture space, where she describes a system where economic tie-ups between funds creates a whole host of structural issues that benefit capital allocators while founders (and emerging fund managers) suffer. Where I would suggest we are starting to see more enmeshment is in the political sphere, where investors and founders take their marching orders from prominent investors and, at risk of being ostracized, fall in line with similar political viewpoints. I need not point out the terrible consequences of such enmeshment occurring, especially in an industry claiming to be the arbiters of future innovation.

The latest rage in software sales is the concept of Product-Led Growth. There is literally an organization called the Product-Led Growth Collective that explains this practice as such:

an outstanding customer experience has always been key to success. Once that experience was owned by sales. If you wanted to buy a new product, you talked to a salesperson. If you were lucky, they were knowledgeable and empathetic and helped you buy the best product for your needs. With the internet came a growing ability for early digital marketers to measure results and to own growth metrics like engagement and acquisition.

But people don’t want to interact with salespeople or marketing campaigns anymore—not at the expense of actually getting to experience the product they’re buying. To keep up with the market and get ahead of the curve, businesses must reshape their marketing, sales, and service strategies and fundamentally rethink the roles of their customer-facing teams.

Effectively, what it means is that what you say is no longer as important as what you do. It’s allegedly more meritocratic and, in the eyes of many software buyers, a smoother experience.

I was thinking about this concept a bit as I wrap up week seven of my parental leave. I’ve been waking up each morning feeling a conflicting sense of anticipation for what our little tot will show us today — whether a smile or a sizeable turd in his diaper — while also feeling anxious and afraid of where my professional life is heading.

In many ways, if I was to superimpose the idea of product-led professional growth right now, I am saying a whole bunch about my professional life but doing exactly squat - and moreover, any attempts to remedy that would diminish the joyful experience of bonding with my kid.

My initial assumption was that, geez, I’m an ass, and I’m the only parent squandering precious mental time I could spend on raising a tiny human while stewing about my career trajectory. Turns out — duh — other parents have experienced this too. One mom wrote this about her leave experience:

Here’s a typical sequence: things start off just fine for ambitious professionals turned infatuated parents. The first days of newborn deliciousness and the adrenaline of having given birth yield a few weeks of immersion, with feelings of deep contentedness and rapture for your tiny offspring.

The intensity of that bond then contributes to a surprising panic about returning to work. Thoughts emerge, like how can I leave this helpless small person in someone else’s care when Iwant to be providing that care? A sort of desperation sets in as you start considering chucking the professional life you worked hard to build to be home with your children

But then a new anxiety surfaces: the anxiety of not having gotten anything done that day. Feeding the baby, doing the laundry, making family meals, and doing drop offs and pick-ups don’t feel productive or energizing if you spent years training to do something else with your brain and body. As Simone de Beauvoir famously wrote, “few tasks are more like the torture of Sisyphus than housework.” And even if you don’t feel quite that melodramatic, focusing exclusively on childcare certainly can leave your brain or your creative instinct feeling a tad sluggish.

I think it was around week two when the anxiety of doing nothing set in. I found myself scanning my work email and Slack for the slightest hint that this lack of productivity was causing my team to consider me expendable (this is my own personal fear trigger: being abandoned). And, yes, it meant that no matter whether or not my son fell asleep on my shoulder instead of my partner’s, the sating feeling of professional success wasn’t there…and thus, my day was unfulfilling.

Observing this has been equally revelatory and obvious. For one, this is the longest time I’ve spent away from some form of professional pursuit in twelve years (even between jobs, I’d be actively networking and jotting down thoughts), so there is a flood of anxious thoughts related to my value to Capitalism that have no resolution at the moment.

I’m curious how this will play out as I return back to work in a few weeks — will it be a motivator to find balance in life, or will I be kicking myself for pouring so much negative energy that could have been honed elsewhere?

Since the Great Layoffation of 2022-2023 commenced, I’ve read lots of pieces on the sharpness of lines being drawn between capital allocators and the working class. The most recent one I skimmed is here.

One tidy quote sums it up:

I’m going to make an assertion here: If you are (or were) a tech worker — a software engineer, a site reliability engineer, a product manager, you know, the kind of people who actually do the work — you’re not in the same class as the tech executive.

The tech executive is in the capital class. They are compensated with 7-figure stock packages. Their interest is in maintaining the security of their position by upholding the values of their class. They share no interests with you.

If you haven’t grasped this idea yet, just move on. Go read Hacker News. Read Leetcode’s advice to the lovelorn. This isn’t for you.

I’ve lived many lives in tech, and I have a bit of a difficult time grasping the idea that workers and the capital class are clearly drawn-in. I think what is happening right now is the class battle that product marketers, salespeople, comms, and HR workers in tech have been facing for decades is finally coming to the engineering class, and (just like those other groups) they’re discovering that they, too, are replaceable. Of the three layoffs I’ve experienced in the industry, zero percent of them involved anyone on the technical side — so, admittedly, my experience is somewhat biased.

On the same beat, there isn’t a truly unified capital class, either: there is a stark difference in power between LPs and VCs, for example, especially more junior VCs whom, even with a partner title, don’t have access to self-sustained deal flow nor any ownership stake in the outcomes of the fund. In many ways, the latter is simply an investment banker with more Twitter clout.

All that said, though, I think it is a good thing that the engineering class - with it sitting at the top of the worker class food chain - to finally see what folks in non-engineering roles in tech faced for many years. More solidarity is a better thing.

But I just hope that this collective ire isn’t directed at some VC associate (unless, of course, they’re an unashamed sycophant of your neighborhood billionaire). They’re just as much a cog in the system as the other 99.9 percent of us, and if there is to be true, philosophical changes in our current iteration of capitalism, we need to acknowledge and embrace that.

Note: I’m aiming to write short notes more often, as opposed to my typical longforms I shared across on my Medium Blog. Here’s a start.

I’m writing this with my five week-old son hanging in a sling on my chest. To say that his arrival in the world is a miracle would be…well, it would suggest that modern science is a miracle, which in many ways, it is, but not in the mystical way we often use it.

The TL;DR is that we conceived through a process called Intracytoplasmic Sperm Injection (ICSI), which if viewed in the eyes of a 5th century alchemist, would be viewed as pure alchemy in its complexity. Basically, though, it’s like the nanotechnology of IVF: while a typical artificial insemination process requires 50,000-100,000 sperm cells per attempted fertilization, ICSI can fertilize an egg with one. Simply remarkable. I’ll explain in the future why we had to go this route.

ICSI is an incredible leap forward in technology, and as a tech-adjacent person, my mind immediately goes to thinking of ICSI’s origins. The hypothesis I went in with aligned with my Salkian hopes: this was invented in a publicly-funded lab by researchers seeking out demonstratable technology that could be replicated and, eventually, made more cost-effective.

And wouldn’t you know it — I was right. At the time of his breakthrough research into ICSI, Gianpiero Palermo was teaching professor at Vrije Universiteit in Belgium, which is funded by combined private dollars and state funding. Ultimately, the procedure was adopted by clinics globally as the preferred method for helping patients with male-factor infertility to conceive. And while this procedure became widely adopted, Dr. Palermo raised $100 million in Series A funding from multiple Sand Hill investors to privatize the technology (cough) I mean, continued to study and teach at universities worldwide on the topic. Moreover, he even published a cautionary article on the abuse/overuse of the technology he discovered.

The discovery of this life-changing technology isn’t what fascinates me. It’s that, along the way, the creator of it didn’t become insanely rich. It didn’t make a venture capitalist wealthy. And it didn’t create a new crop of angel investors working for PalermoCo who cashed out and now boast a portfolio of startups they’ve funded, yet by many measurements, we would view a technology that does not achieve those things as menial or uninteresting, and that is a fundamental problem with the state of technology and its investors today.

Meanwhile, it did make two folks parents, and as I rock my son back and forth typing this, that is a measureable difference that is priceless.

Within these articles, I also provided a comforting reflection: we had a bit of choice on how much we choose to engage with this debate.

I’ve discovered that engaging with people who are addicted to power, prestige, and attention will provide me with no added benefit, will probably just make me feel worse about myself, and there are dozens of books on my shelf — or even a call with my Trump-supporting, Tech-averse parents — that offer more sage advice with a kinder veneer than they ever will. There are many tech leaders that believe the best way to prove a point is to do it through brute force humilitation of an opposing viewpoint and the person who carries it, and this humiliation is often disproportionately lobbed at people of color — that is toxic, unproductive, and maddening. While we should admit that these tech leaders may have some power over you, it’s your choice on how much more you want to give them.

Now, I have probably over-rotated a bit on Twitter as my engagement medium of choice; this is a bit of a necessity due to being in a Tier 2 investment corridor, removed from epicenters of early-stage venture capital allocators. I’ve made some friends and collaborators - and also a few enemies, which is a natural byproduct of sharing contrarian views of a cottage industry.

But I’ve seen a more prominent pattern of even the more balanced tech leaders adopt the talking points of fringe far-right investors. Emerging fund managers count techno-libertarians with a bent toward destroying journalism as LPs without batting an eye. And with Twitter’s new ownership choosing to silence voices of dissent - banning journalists opposing their views while reinstating those with terrifying views - I am less convinced that Twitter is the proper place to voice dissent.

It feels like Twitter is become more of a self-promotion and marketing engine for investors and tech leaders instead of a place to engage in dialogue on topics that are necessary for us to wrestle with. While Twitter has kindled sweeping changes in national power, empowered activists, and moved societies, the entrenched leaders in tech have been unmoved by these societal shifts.

So, I’m going to be focusing more energy on long-form observations of my industry. I think it’ll be more cathartic, but also productive - both for you and me. I want to dive more into these topics in ways that 280 characters and quote-tweeting something I dislike ever could.

And I encourage you to offer your perspectives, too. I plan to keep this free for audiences for now - including opening the comments section to all subscribers.

I look forward to learning alongside you all. -M

Wanna build? We need to break down some things first.

Continue reading on Medium »

How to hold venture capitalists and tech leaders accountable for their bad behavior, bad takes, and bad karma

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An emotional accounting of what we VCs do wrong

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I find the intersection of social impact and venture capital to be incredibly exciting. If you’ve followed me much at all — either via my…

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Some reflections on the journey from tech to investing — complete with photos, failures, and suggestions.

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As the time arrived, this premonition came all the more true. Typical daily work was replaced with quick tweaks here and there of a Keynote. Wrangling speakers for various talk tracks went from gentle nudging to stern reminders. And visions of various Salesforce critters became part of my evening dreams (or nightmares, depending on how the previous day had gone).

My mind was fixated on helping Dreamforce become an amazing, fulfilling experience for attendees (and, in typical Salesforce conference fashion, it was). But down the road, another conference that was gearing up occupied a dormant, yet ready to burst, section of my heart: SOCAP.

-

Now, it shouldn’t be surprising this occurred: anyone who knows me has heard me say that I have “a public policy degree just sitting there “, and while there are some ancillary benefits of policy analysis I brought to my work, I’d sadly state that the deep-rooted parts of my studies had not yet been challenged. Even as I glanced back at my business school admissions essays, “I want to combine my engineering experience with a business background to help a world in need” comes through in a pretty obvious way.

I knew that, eventually, the longing to practice something along those lines would reach critical mass. So, when I joined Salesforce in a Product Marketing position, I had a few chats with Meredith Finn and Matt Garratt, who ran the Salesforce Impact Fund and Salesforce Ventures, respectively. I wasn’t looking for a job (uh, I had one), but i was starting to get a little bit antsy: how could I get closer to the place where capital could be used to help meaningful businesses thrive? Their advice: find a way in to impact-focused venture capital. It was pretty apparent that staying on a pathway of being a product expert would be really valuable — up to a point. But then it would take a bit of luck and timeliness, a willingness to get humbled by a totally different way of working, and an openness to drinking from the firehose.

Fortunately, the convergence of those things would come sooner than I thought.

After moving to DC with Stephanie late last year, I admittedly put the idea of pursuing a career in impact-focused venture capital in the back of my mind. I had to focus my energies on helping the Democrats win an election with smart uses of data. But after a pretty abrupt end to my time there, I suddenly faced a whole host of opportunities that probably wouldn’t have even crossed my tech-emblazoned event horizon if we were still in the Bay Area.

As a segue: it’s incredible what a scene change can provide. Friends that have journeyed away from the Bay Area have started commuting to work via trail run, settled into a sleepy college town in central Massachusetts, or started an adventure tights company. So when I settled in and started to explore whom I knew — and where I wanted to work — in DC, the pathways bifurcated into a kaleidoscope. Finance, tech, politics, government agencies, consulting firms — of equal measure, opportunities existed.

One of our closest friends in DC, Caroline, is a longtime impact investor, and it was during this time that said dormancy lit up. She must know what’s going on here, I thought — and she did. In a big way.

I’ll fast forward the details behind my conversations, the process, and the decision, and get right to it: I’m thrilled to announce that I’m joining the Accion Venture Lab team, helping their portfolio of entrepreneurs serve a world in need.

There are myriad reasons why I’m excited, but here are a few:

- Focus. Fintech is a space I’ve dabbled in, having worked with a handful of organizations at GitHub and Heroku that used our services. Accion’s been in the game of exploring, evaluating, and acting in financial institutions for over fifty years, and this expertise spills over into how Venture Lab approaches tech companies looking to advance the cause of financial inclusion.

- Kaleidoscope. The team I’m joining represents a variety of countries, backgrounds, genders, and experiences. For this midwestern-bred, public school-educated thirtysomething white guy, I can point to Accion as a place I feel most, well, comfortable.

- Success. A glance through Accion’s portfolio makes it clear: there are some amazing ideas the team has invested in. Whether working on migrant remittance programs, crop insurance, or small business lending, the breadth of their investments and the countries they serve is pretty vast.

- Exploring. I’m entering a new role where my colleagues know far more about the challenges of scaling a sustainable business. I have so much to learn, yet I can’t think of a time recently where I’ve been so excited to dig into a topic and do my best work.

I’m grateful to everyone that has provided guidance, counsel, and even a free coffee here and there the past few months. You’ve been wonderful sounding boards, and at some point, I have no doubt that “Career Karma” will provide an opportunity for me to offer thanks in a more tangible way. But for now, I’m going to go and see if I can get the #SeeYouAtSOCAP hashtag trending on Twitter.

Originally published at http://mattschaar.com.

The fintech world is still buzzing about Intuit’s announcement that it will acquire Credit Karma for $7.5 billion. Credit Karma’s steady ascent, expanding portfolio of services beyond free credit reporting, and a broad slate of partnerships make it a veritable success story for their founders and investors. (We also have to give a shout-out to our DC-area neighbors — and occasional co-investors — at QED for this one!)

As a platform that promotes financial inclusion for millions of consumers in America and across the world, we at Accion Venture Lab are excited to see platforms like Credit Karma thrive. Combined with other parts of the fintech value-stack — payment platforms like First Data or rewards aggregators like Honey, for example — these stories ensure that the fintech world is ripe for even more innovative partnerships. Credit Karma’s mission puts it in a bit of a different category, though: as its founder, Kenneth Lin, says, “We started Credit Karma with a goal to build a trusted destination for all consumers, to make financial progress regardless of where they are in life.” They’re openly declaring that their value comes less in the form of more commerce, but smarter commerce for its 100 million members.

The fintech world is probably wondering what the next frontier is — and we’re seeing several platforms that have the potential to make their mark in fintech lore. They may not be intuitive to Silicon Valley or the U.S. venture capital world, though — and no surprise: they’re operating in markets some investors in the U.S. haven’t yet explored.

Here are a few trends that make us believe we’ve not seen the end of high-value consumer services like Credit Karma:

Consumers exist everywhere, and they’re increasingly interested in their financial health.

Our portfolio operates in high-population markets like India and Mexico, where we’ve seen a continued, rapid expansion of interest in the types of services that Credit Karma provides. Consider the fact that a far larger proportion of the population in each of these markets is not only underbanked but also has never had any form of credit whatsoever. According to the World Bank, roughly 20 percent of the world’s population — or 1.6 billion people — are underbanked, and over 200 million Micro, Small, and Medium Enterprises (MSMEs) have no access to traditional banking services.

There is also a compelling case for focusing on these markets based on consumer trends: in India, for example, consumer spending is expected to quadruple by 2030 on the heels of an increasing GDP per capita, and a cursory glance at consumption as a proportion of GDP shows that these countries have robust consumer spending. McKinsey’s research suggests that, in 2025, more global citizens will be part of the consumption class than those living in poverty — the first time in modern history this will have occurred.

What’s encouraging is that many financial services providers operating in these markets don't have a “brute force” mentality — many of them recognize that temporary gains can be detrimental to consumer confidence and overall market health. Our colleagues at the Center for Financial Inclusion have spent considerable time working with local and global financial institutions to encourage the appropriate use of financial instruments, marketing, and resources to ensure that consumers are well-educated on their financial state as they enter the consumer class.

Moreover, the business makes sense.

A common concern we hear when someone is considering an investment abroad is the potential for returns that match those in well-developed markets: that the opportunity for scale is too low, the revenue per user (ARPU) isn’t high enough, and the exit will take longer. This is traditional top-line thinking that ignores a few areas of inertia — namely, both acquisition costs and operating costs are lower in many of the markets where we operate. We encourage our companies to scale responsibly and take on a balanced amount of financing to keep the business thriving. Our investment dollar extends far longer with a Lagos-based company than one in San Francisco — and it’s just smarter to be building tools in the markets you serve. The proof is in the numbers: rates of return for emerging markets-focused venture capital rival those of North American and Europe-based funds.

Finally, emerging markets startups are thinking in terms of unit economics and growth.

Whether we’re first looking at a company or working on a new product with them, we stress the importance of unit economics (UE) and its status as the Holy Grail of metrics. Without it, growth is perilous — but on the same end, positive UE without growth is boring. So, we pay very close attention to it and continuously press our founders to dwell on it. Simply put, the relative dearth of available venture capital to seed-stage companies in these markets means that positive UE will be an important factor. And while traditional, Silicon Valley-focused investments will account predominantly for growth (even past the IPO), investors will continue to want to flock to a more reassuring asset class — well-balanced startups in traditionally overlooked markets. How’s that for a plot twist?

Profiles in Opportunity: Credit Mantri and Destácame

I couldn’t walk away from this post without sharing a few examples of companies we’ve seen that are validating these trends. I’d like to introduce you to two of them:

CreditMantri is an India-based company focused on helping consumers understand the status of their financial health and providing them with products and services suited to their credit profile so that they can build and maintain good credit health. When we first partnered with CreditMantri in 2015, we believed that the time was ripe for a breakthrough in financial transparency for emerging markets consumers. CreditMantri’s model approaches customers initially with a glimpse into their financial health via credit scoring, then actively works to understand this consumer using traditional and alternate data. Besides addressing the needs of the credit healthy consumer, what sets CreditMantri apart is the ability to address the credit needs of consumers who have been denied access to credit and then help these consumers get back into the formal lending ecosystem.

CreditMantri does this with a strong, data-led product platform and deep lender connections across multiple teams in the lender organization. CreditMantri also works with Sales, Product, and Credit teams at lenders to create special programs using alternative data to help lenders acquire new customers, while also working with Recoveries and Collection teams at the lender to help them recover delinquent loans. To date, CreditMantri has served more than 10 million individuals and small businesses in India, partnered with over fifty lenders, and it has a bright outlook ahead.

Chilean-based Destácame operates with a similar model in mind. When we first met them in 2017 and participated in their seed round, they wanted to deliver their tested-and-proven alternative credit scoring model to Mexico. Since then, they have provided not only a unique method of introducing underserved customers to credit and financial health, but they have added a complete marketplace of banking services to their users in Latin America via partnership with traditional financial institutions. Their set of services is quite diverse, ranging from past-due debt repayment to savings, and from alternative credit assessments to direct credit products. Through this unique approach, Destácame’s customers have a suite of tools to understand financial health, and banks have more thoughtful channels to introduce their services to this growing class of consumers. More than 2.5 million people across Chile and Mexico are benefitting from their approach.

So, investors, turn your eyes outward and gaze upon the opportunity ahead. We’ve been investing in these markets for nearly a decade — and we can safely say it’s been not only enjoyable, but extraordinarily beneficial to investors, startups, and the people they serve.

Where’s the Next Credit Karma? Look to Emerging Markets. was originally published in Ventures on Medium, where people are continuing the conversation by highlighting and responding to this story.